1. SOURCES OF EMPLOYMENT LAW
Employment law in France is mainly based on the following sources set out in order of priority:
The Constitution
European legal instruments
The Labour Code (Code du Travail)
The Labour Code, made up of laws, regulations and decrees, determines nearly every aspect of French employment law.
Case law
The provisions of the Labour Code are interpreted through decisions of the Employment Law Section of the Supreme Court (Cour de cassation). In recent years, decisions by the Supreme Court have led to significant changes in the areas of French law on (i) dismissals on economic grounds, (ii) employee protection in the event of a transfer of undertakings and (iii) information and consultation of staff representatives.
Collective bargaining agreements (conventions collectives)
Collective bargaining agreements are written agreements, entered into between one or more employee-representative trade union organisations and one or more employer-representative trade union organisations.
They govern individual and collective employment relations, working conditions and employee benefits in a given industry (eg, the chemical, banking and pharmaceutical industries, etc). Collective bargaining agreements can be binding on a national, regional, or local level.
Collective bargaining agreements are only generally binding on the members of the employers’ trade union organisations that signed the agreement. However, the Ministry of Social Affairs, Labour and Solidarity has extended the scope of most collective bargaining agreements and they are consequently binding on all employers whose line of business is covered by the agreement.
In case of doubt or legal dispute, the Labour Inspector determines which collective bargaining agreement applies, subject to the court’s review, based solely on the company’s line of business.
Company collective agreements (accords d’entreprise)
Company collective agreements are reached between the head of the company and the representatives of one or more trade union organisations represented within the company.
French law protects trade union organisations and provides that agreements entered into at company level must be negotiated with trade union representatives in many areas of employment law, thereby preventing the head of the company from negotiating with the works council. For agreements signed after May 2004, company collective agreements can be less advantageous to employees than the collective bargaining agreements, if the collective bargaining agreement does not forbid it. However, company collective agreements can never be less advantageous than collective bargaining agreements in the following domains: minimum wage, professional classification, and funding for training and social security.
Atypical agreements (accords atypiques)
At company level, agreements may be entered into with the staff delegates or the works council rather than with trade union representatives and, in such a case, they are defined as atypical agreements. They do not come under the category of company collective agreements.
Atypical agreements may not be entered into as a means to bypass the trade union representatives’ prerogatives. Therefore, atypical agreements can only be entered into in areas of employment law, which do not fall within the exclusive jurisdiction of the trade union representatives, and only apply if they are more advantageous to employees than other sources of French employment law. Since a law of May 2004, if the collective bargaining agreement has expressly allowed it, in the absence of trade union representatives, the employer has the possibility to enter into company collective agreements with the works council or staff delegates; however, the agreement has to be approved by a committee representing both the employees and management of the company’s industry sector.
Internal Rules and Regulations (règlement intérieur)
Internal Rules and Regulations must be issued in all companies with at least 20 employees. They are in essence a unilateral contract drawn up by the employer.
They must be written in French and be approved by the staff representatives and/or by the Labour Inspector before they come into effect. Article L.122-34 of the Labour Code lists the clauses that may be included in Internal Rules and Regulations – that is, rules on health and safety and general provisions on sanctions and discipline.
Internal Rules and Regulations must be displayed in the workplace.
Two copies of the Internal Rules and Regulations must also be sent to the Labour Inspector for approval. The Labour Inspector may require that certain illegal clauses be deleted or amended. The Labour Inspector is authorised to do so whilst the Internal Rules and Regulations remain in force and may notify the company of amendments to be made at any time. The company has two months to challenge the Labour Inspector’s decision following notification.
Common practices (usages)
Employment relations are one of the few areas in French law where common practices remain a significant source of law, particularly regarding notice periods, bonuses, disciplinary action, etc. A company’s common practices constitute a source of rights for its employees.
However, common practices are not as important as the aforementioned sources of law, as the company may revoke them at any time, subject to (i) notifying the staff representatives and each individual employee concerned and (ii) respecting a reasonable notice period (normally three months) between the notification of the employees and the revocation of the common practice.
2. PRINCIPAL INSTITUTIONS
This is the government institution mainly responsible for the policy and the detailed statutory drafting of employment law in France. Within the Ministry, two departments are worth considering: the division of Employment Relations and the division of the Department of Employment (délégation à l’emploi). The local branches of the Ministry are the departmental and regional work divisions.
This is an organisation with an advisory role on all economic and social bills. Its consultation is compulsory. It can moreover suggest any reform it may find necessary.
This is also a major institution as it participates in the enforcement of employment policies. Its role within the employment public service consists of assisting unemployed people in finding a new job or attending a training programme, as well as in helping recruiting firms find the appropriate candidate.
Created in 2004, this benefits from major investigation capacities so as to unveil any kind of discrimination prohibited by law. Employees can submit their cases directly to the Authority, which can moreover automatically submit cases to itself, when it considers these to be relevant. Where facts suggest discrimination by the employer, the Authority can either submit the case to a court or offer a settlement agreement to the employer in the form of a settlement fine (amende transactionnelle) of €3,000 for an individual and €15,000 for a company. In addition or as an alternative to such a settlement agreement, the Authority can order the company to post an official statement in a specific place for no more than two months, transmit such a statement to the works council or the staff delegates as a means to inform them of the case, or have the company publish the Authority’s decision within company premises (all of the above measures being financed by the company, provided it does not cost more than the maximum possible settlement fine).
3. ROLE OF THE NATIONAL COURTS
France’s employment court is the Employment Tribunal (Conseil des Prud’hommes (CPH)), a professional court composed of elected judges. They have jurisdiction over individual claims arising from the employment contract, whatever activities or amount of indemnities are concerned. Appeals on questions of law are heard by the Employment section of the Court of Appeal and thereafter by the Employment section of the French Supreme Court, ie the Cour de cassation.
These consider actions for the quashing of administrative acts related to employment policies as well as claims regarding the validity and legality of such policies’ enforcement decisions.
Appeals go to the administrative Court of Appeal and then to the Conseil d’Etat, ie the Administrative Supreme Court.
These have jurisdiction over violations of certain employer or CEO obligations that represent an offence or an infringement. They also hear claims arising from particular infractions committed by employees in the event of a work conflict. Civil courts are required to put off their procedures until the criminal decision is rendered and must abide by the criminal court’s judgment. Appeals go to the Criminal Law Section of the Court of Appeal and then to the Criminal Law Section of the Cour de cassation.
These have jurisdiction over personal and movable claims and over special claims that fall outside the Employment Tribunal’s jurisdiction (such as profit sharing or financial participation, types of employment deprived of employment contracts, like internships) and over any claim that has not been attributed to a court by legal text. These claims can moreover deal with collective employment relations. Civil courts have jurisdiction over claims regarding staff representative elections or appointments. The appeal procedure is the same as for the aforementioned courts.
4. EMPLOYMENT STATUS AND CATEGORIES OF WORKER
Generally, if a worker has a contract of employment, he/she is considered to be an employee. Employment status can nevertheless be defined either by law or by courts. The law determines which activities come under the employee status and which ones fall under the self-employment category. When a status cannot be decided on by law, the courts use various criteria so as to tie an activity to an employment status. The major criterion is whether there is a superior-subordinate relationship between the parties.
Case law has outlined other criteria such as the place of work, the working hours, the payment of the worker, the relationships between the parties, whether or not one party has a management authority over the other, if there is mutual aid between the parties or if it is unilateral and finally the ownership of goods, supplies and products.
The distinction is highly relevant as the legal rights enjoyed by and applicable to each status differ widely. Being an employee for instance allows the person to benefit from Labour Code protection and from the workers’ social security. Furthermore, the Employment Tribunal has jurisdiction over employee claims. It appears that self-employed workers do not benefit from the Labour Code protections and rights.
Workers in France are usually categorised as follows:
In the event of a dispute, the court will look at the actual duties performed by the employee rather than the professional category mentioned in his/her employment contract, or on his/her pay slip.
The different types of employment contracts can be defined as follows:
Indefinite-term employment contracts
Indefinite-term contracts (contrats à durée indéterminée) are the standard type of employment contracts used in France. The law favours indefinite-term contracts over other types of contracts since they encourage employment stability and provide greater protection for employees, particularly in terms of dismissal.
A new type of indefinite-term contract called the new hiring contract (contrat nouvelles embauches) was created by an ordinance of August 2005. This new contract introduces a simplified process for the termination of the indefinite-term employment contract in companies with less than 20 employees, for the first two years of the contract. Beyond a trial period of one month, it will be possible for both the employer and the employee to terminate the employment contract by registered letter with acknowledgment of receipt, without it being necessary to present any grounds whatsoever. After two years, the contract shall be subject to standard procedure in terms of indefinite-term employment contracts.
Fixed-term employment contracts
Circumstances where a fixed-term contract may be used
Pursuant to the Law of 12 July 1990, a fixed-term contract (contrat à durée déterminée) may be used in a limited number of circumstances, in particular, to:
Pursuant to a decree of 28 August 2006, employers may also use a fixed-term employment contract for employees older than 57 years of age and who have been unemployed for at least three months or currently benefit from a personalised redeployment agreement (convention de reclassement personnalisé). This contract can last up to 18 months and be renewed once.
If an employer appoints an employee under a fixed-term or temporary contract in order to avoid employing the employee under an indefinite-term contract, the courts will redefine such a contract as an indefinite-term contract and the employer may be subject to criminal sanctions.
Renewal of a fixed-term contract and successive fixed-term contracts
A fixed-term contract may be renewed once, provided that the total period of employment (initial period and renewal) does not exceed the statutory limit of 18 months.
The employee must be informed of the renewal before the end of the initial term. Alternatively, the fixed-term contract may be renewed by a rider that must be signed by the employee before the end of the initial term.
Non-compliance with legal provisions regarding the renewal of a fixed-term contract and successive fixed-term contracts leads to such contracts being redefined as indefinite-term contracts.
Temporary employment contracts
The Law of 12 July 1990 sets forth the conditions for the use of temporary employment contracts, which are similar to those governing fixed-term contracts. Temporary workers are not employed by the company where they perform their duties, but by temporary employment agencies, which are regulated by statute and have the monopoly in the field of sub-contracting with the intent of making a profit on the employee’s activity.
If the conditions relating to temporary work are not observed, the employee may be entitled to the same rights as an employee bound by an indefinite-term employment contract. Moreover, the employer runs the risk of being fined €3,750 by a criminal court. Any subsequent offence leads to a maximum fine of €7,500 and/or up to six months’ imprisonment.
Part-time employment contracts
Part-time work may be introduced by the employer or at the employee’s request, after consultation with the works council or the staff delegates and, in the absence of staff delegates or a works council, the Labour Inspector.
Any employment contract that provides for working hours lower than the working hours
(i) provided for by statute, (ii) provided for by the collective bargaining agreement or (iii) practiced in the company, is considered to be a part-time employment contract. A part-time employee must sign his/her employment contract before joining the company. Otherwise, he/she may claim to have been employed under a full-time contract.
Part-time employees have the same rights as full-time employees. Part-time employees are included in the headcount on a pro rata basis.
Other types of employment contracts
Various other types of contracts, such as apprenticeship contracts, qualification contracts (contrats de qualification) and contracts designed to facilitate professional reinsertion (contrats initiative-emploi), aim to improve employees’ vocational training. An employee’s eligibility depends on factors such as age and qualifications. The government provides some financial assistance to employers entering into these contracts, and employers are often exempt from paying social security contributions.
The real management of a firm in France belongs to corporate officers who are legally different from senior executives. Their corporate mandate differs from executives’ employment contracts in that:
Corporate officers can concurrently hold their employment contract and their corporate mandate, although it has been admitted by case law on highly restrictive grounds. The employment contract is judged valid on the condition that it corresponds to an effective position with specific attributions that cannot be mistaken for the ones deriving from the corporate mandate. If that condition is not met, the employment contract is void.
When the employment contract is entered into before the corporate mandate, it is either merged within the corporate mandate or suspended. As soon as the mandate is over, the former corporate officer resumes his position pursuant to his/her employment contract.
Specific rules apply to the incorporated joint-stock companies (société anonyme, SA): a corporate officer cannot obtain an employment contract, but an employee can be made corporate officer. However, it must be noted that the number of former employees turned officers cannot exceed one-third of all the officers.
5. CONTRACT
The commonly admitted definition of an employment contract has been given by case law. It is an agreement according to which a physical person commits himself or herself to put his/her activity at the disposal of a physical or legal entity and under the subordination of which he/she stands for remuneration.
Its three main criteria are the superior-subordinate relationship, the payment – be it in kind, for the time worked, by the piece or a combination of the two – and the personal performance of a job.
For the contract to be valid, its cause and object have to be licit and there has to be mutual consent between the parties so as to enforce the contract.
In accordance with EU Directive 91/533, the main terms and conditions of an employment contract beginning after 1 July 1993 must be in writing. However, a contractual relationship is considered to exist between the employer and the employee even if there is no written document. In this case, the employee may request a written contract from his/her employer.
Employment contracts executed in France must be drafted in French. Where French is not the employee’s mother tongue, he/she may request a translation of his/her contract in his/her own mother tongue. In the event of a dispute, the contract drafted in the employee’s mother tongue prevails.
However, a written contract of employment is required:
Other than that, some additional formal requirements must be complied with in relation to the formation of an individual employment contract:
Formalities to be observed prior to or immediately upon appointing employees
The employer must make a declaration to the social security authorities as to the hiring of new employees no later than eight days following the employment start date, to the unemployment services in a two-month time frame following the employment start date, and to the social security contributions collection body at the earliest eight days before the hiring. The employer must also register new employees with the competent Labour Inspector.
Formalities to be observed before the end of the trial period
Employment contracts and/or collective bargaining agreements may provide for a trial period. Upon appointment, the employee’s name must be added to the staff register, the employee must undergo a medical examination and the employer must make certain filings with the National Employment Agency (Agence Nationale Pour l’Emploi), the social security authorities and other benefit authorities.
In addition to the employment contract, the legal relationship between employer and the employee in France is governed by a hierarchy of collective sources of law, including:
The employment contract can only depart from collective sources of law to the employee’s advantage.
6. TERMS AND CONDITIONS
Indefinite-term contracts
They should contain the following information:
Fixed-term contracts
Except for the notice period, which is not applicable, they must contain the same information as the indefinite-term contracts. In addition, fixed-term contracts must specify:
Part-time contracts
In addition to the general requirements for employment contracts set forth above, they must state the following:
The following terms can be included in an employment contract:
Pursuant to article L.212-1 of the Labour Code, the legal working time is 35 effective hours per week for most employees. It cannot exceed 1,607 hours per year. This working time applies to all economic sectors other than the public one and the ones regulated by specific laws (agriculture, collective transportation, etc). The maximum work week is 44 hours on a consecutive 12-week time frame and 48 hours when one week is considered. The maximum daily working time is 10 hours.
In general, working time is organised through a collective working time schedule negotiated and enforced in each company for all the employees, although some companies can choose an individualised working time.
Employees cannot work more than 220 hours of overtime per year. Should they need to work more than this, the Labour Inspector’s authorisation is required as well as the information and consultation of the staff delegates. Employees’ overtime is compensated with the payment of their extra hours at a special rate. Concerning overtime over 220 hours, the employees are entitled to extra rest breaks; they can credit them to their time savings account (compte épargne-temps).
Executives’ working time can be organised in three different ways:
– a yearly working time limited in days, in which case they have 218 working days per year. In any case, should they work more than this, their rest breaks can be credited to a time savings account.
The Act of 2 August 2005 has extended the possibility of applying the fixed annual working time in days to employees whose working time cannot be predetermined and whose autonomy and responsibilities justify it.
Employees are entitled to five weeks’ paid holiday per year, unless more advantageous terms are provided for by the applicable collective bargaining agreement.
Entitlement to paid holiday is accrued on a monthly basis and may be taken as soon as accrued.
As holiday leave can disrupt a company’s activity, it is within its sole discretion to decide when holiday leave may be taken, in accordance with the provisions of the collective bargaining agreement. However, a minimum of 12 working days must be taken between May and October and it is not possible to take the fifth week of paid holiday consecutively with the other four weeks.
Within these holiday periods, the company decides, with prior notification of the staff representatives, in which order the employees may take their holiday. Once the order has been fixed, the company then decides on the dates for each employee. If an employee leaves on holiday without the company’s approval, this may constitute real and serious grounds for dismissal. Once the order and dates are determined, the company may not modify them in the month before the holiday.
In certain cases, the company’s decision to split an employee’s holiday leave into several shorter breaks over the year may entitle that employee to additional holiday.
In addition to the foregoing, the Labour Code provides for additional days of paid leave for employees who have acquired a specific length of service and for family events such as:
agreements. Autonomous executives also benefit from additional days off (usually about ten days per year).
7. EMPLOYEE REPRESENTATION
French employment law provides for various staff representative institutions.
Staff delegates must be elected in companies with more than ten employees. The number of staff delegates depends on the employee headcount. This number is increased in the absence of a works council and/or health, safety and working conditions committee (comité d’hygiène, de sécurité et des conditions de travail) in companies with 50 to 199 employees. The staff delegates are elected for four years and may be re-elected. Their role is to put forward to the employer individual or collective claims relating to salaries and the application of the provisions of employment law and collective agreements. The employer is required to hold a minimal monthly meeting with staff delegates.
Organisation of the works council
A works council must be set up in companies with at least 50 employees. The number of members elected to the works council depends on the company’s headcount. Members are elected for four years and may be re-elected by employees (in different electoral colleges according to their professional category). The head of the company chairs the works council.
Staff delegates and members of the works council are elected at the same time.
In companies with less than 150 employees, the works council must meet every two months, whereas in companies with at least 150 employees, the works council must meet every month. Moreover, when the staff delegates also represent the employees on the works council in companies with less than 200 employees, the works council must meet every month.
The agenda for the works council meeting is prepared jointly by the secretary of the works council and the head of the company, and must be issued to the members of the works council at least three days before the meeting.
The works council’s duties are of an ‘economic and professional nature’; it is also responsible for the management of the social and cultural activities provided for employees, which are financed by the employer and whose calculation is based on the gross annual compensation bill.
Management representation
Pursuant to article L.432-6 of the Labour Code, two (or four, in large companies) works council representatives, appointed by the works council, may attend board meetings. These members must be convened to every board meeting in the same way as the directors, and must receive the same information prior to these meetings. The works council representatives do not vote on the proposed resolutions, but have the right to express their opinion on them. Failure to convene the works council representatives in accordance with legal provisions constitutes a délit d’entrave (see below: sanctions).
Pursuant to article L.432-6-1 of the Labour Code, two works council representatives (who may be different from the ones appointed to represent the works council on board meetings), appointed by the works council, may attend shareholders’ meetings. They have the same rights as for the board meetings.
The works council may also ask for points to be added to the agenda of the shareholders’ meeting.
An occupational doctor is responsible for supervising health and safety in the workplace. In addition, control over the application of health and safety regulations in the company is carried out by the Labour Inspector, the social security health insurance fund (caisse d’assurance maladie) and by the health, safety and working conditions committee, where applicable.
All companies employing at least 50 employees must set up a health, safety and working conditions committee, whose role is to inform staff of all measures taken to prevent occupational accidents and to improve working conditions. It is composed of the head of the company, staff representatives and the occupational doctor.
Members of the health, safety and working conditions committee are not elected, but appointed by a college composed of the members of the works council and the staff delegates. It must hold regular meetings, as follows:
It is moreover authorised to propose anti-bullying measures. To this end, it has the right to inform the employer of a potential case of bullying in the company (droit d’alerte).
French employment law provides that in companies with at least 50 employees, trade unions may appoint representatives among the employees of the company in order to represent them before the head of the company or establishment.
Where one or more trade union sections have been set up in a company, negotiations on wages and working hours must take place annually. The employer must negotiate in good faith, but is under no obligation with regard to results. Trade union sections may carry out their activities by:
The breach by the head of the company or a duly empowered representative of their obligations towards a staff representative body is a criminal offence known as a délit d’entrave, which is punished by a maximum of one year’s imprisonment and/or by a maximum fine of €3,750 and, for repeated offences, a maximum of two years’ imprisonment and/or a maximum fine of €7,500.
A staff representative body may also take civil action to claim damages for the loss incurred as a result of non-compliance with French law.
8. INFORMATION AND CONSULTATION
According to the law, the works council’s duties are of an ‘economic and professional nature’; it must periodically be informed and consulted on various issues, including:
A sale of assets therefore triggers the notification and consultation of the works council of
(i) the buying company and (ii) the selling company.
The consultation of the works council must always take place before the employer makes a final decision regarding the proposed operation. Otherwise, this would constitute a délit d’entrave. However, the works council does not have the power to veto such operations.
When the works council is aware of a situation that may seriously affect the financial situation of the company, it may ask the employer to provide relevant information. If the employer’s answer is insufficient or if it confirms a worrying situation, the works council may ask for the assistance of a chartered accountant, financed by the company, to prepare a report that will be forwarded to the board.
The committee is informed and consulted on issues relating to health and safety in the company such as any decision concerning the layout, which has significant impact on health, safety and working conditions. It must also be consulted at the time of the drafting of the company’s internal rules and regulations or when this document is modified on issues relating to health and security.
9. EQUAL OPPORTUNITIES
Discrimination
It is prohibited throughout the employment relationship, including with regards to appointment, compensation, professional equality, dismissal and disciplinary sanctions.
No one can be excluded from the recruiting process and an employee must not be punished or dismissed due to his/her (article L.122-45, French Labour Code): • origin;
The employee considering him/herself as a victim of any of the aforementioned discriminations is to present elements of fact to the court. However, it will then be the employer’s burden to prove that its decision was based on objective elements and not on any kind of discrimination.
Discrimination is a criminal offence punishable by a maximum of three years’ imprisonment and a maximum fine of €45,000 for the legal representative of the company. In addition, the company can be fined between €150,000 and €225,000.
Pursuant to the law of 31 March 2006, it is now possible for any interested party to use the practice of testing, which consists of proceeding with surprise verifications in order to gather proof of an employer’s discriminatory behaviour. Such collected proof will henceforth be admissible in courts.
Key concepts
Sexual harassment
In accordance with article L.122-46 of the French Labour Code, no employee or candidate may be sanctioned, dismissed or discriminated against for having been subject to or for having refused to be subject to sexual harassment by any person intending to procure sexual favours for him or herself or a third party. Moreover, article L.222-23 of the Criminal Code defines sexual harassment as orders, threats, constraints or significant pressure by a person abusing his/her authority with the intent of procuring sexual favours.
The claimed victim has to gather proof so as to demonstrate the reality of the acts of sexual harassment. These objective elements of proof such as witness statements are submitted to the judge. It is subsequently for the employer to refute the accusation.
The head of the company is required to take all the necessary steps to prevent sexual harassment. The health, safety and working conditions committee has the right to propose measures intended to prevent sexual harassment. The company’s internal rules and regulations must contain provisions against sexual harassment resulting from an abuse of authority.
An employee who has been subject to, or who has refused to be the victim of sexual harassment by an employer may not be dismissed on these grounds. The same protection is extended to employees who have witnessed acts of sexual harassment. French law further prohibits any discrimination in terms of career development against employees, who have either been victims of or who have witnessed acts of sexual harassment.
Any discriminatory measures (including dismissal) taken against a victim of sexual harassment or an employee who has witnessed such acts are punishable by a maximum of one year’s imprisonment and/or a maximum fine of €3,750. The misdemeanor of sexual harassment is punishable under criminal law by a maximum of one year’s imprisonment and a maximum fine of €15,000.
Any retaliation (including dismissal) against a victim of harassment, or an employee who reported such acts, is a criminal offence punishable by a maximum of one year’s imprisonment and/or a maximum fine of €3,750 for the legal representative of the company.
Moreover, any dismissal resulting from an act of sexual harassment is considered null and void. In this case, the employee must be reinstated or receive compensatory damages.
Workplace bullying
Bullying in the workplace is a topical subject in France.
Article L.122-49 of the French Labour Code provides that ‘no employee may be subject to repeated workplace bullying, with the purpose or the effect of damaging the working relationship and which is likely to affect the employee’s rights, dignity, physical or mental condition or jeopardise his or her professional future’.
This definition increases the scope of the offence and sanctions ‘vertical bullying’, when an employee bullies a subordinate, as well as ‘horizontal bullying’, when an employee bullies a colleague on the same level. Finally, the law also provides that restrictive hiring practices or discrimination of any form against an employee, who has experienced workplace bullying or has testified to such a situation, are prohibited.
The employer is under the absolute obligation to protect the employee from workplace bullying.
Article L.122-54 of the French Labour Code provides for an optional mediation procedure, which may be instigated by both the employee who claims to be a victim of psychological harassment and the accused harasser. The mediator is chosen by mutual agreement of the claimed victim and the accused harasser from a list drawn up by the local prefect.
The onus of proof and the sanctions applicable to sexual harassment offences also apply to workplace bullying.
9.2 Rights available to parents
Maternity leave
Employees are entitled to the following maternity leave, regardless of their length of service:
– 24 weeks before childbirth; and
– 22 weeks after childbirth. If the mother suffers from an illness, six additional weeks can be added, consisting of:
The relevant CBA may provide for additional maternity leave. Following maternity or adoption leave, the employee has the right to return to her original or similar position with the same remuneration and, unless the relevant CBA sets out more favourable provisions, this remuneration must be increased so as to take into account the company’s general salary rise as well as the company’s average salary rise for employees of a same professional category (or all employees in the company’s average salary increase if the notion of professional category is irrelevant).
Alternatively, an employee with one year’s service on the date of the birth or adoption can opt to:
The dismissal of pregnant employees is usually prohibited from the date the employer is informed of the pregnancy until four weeks after maternity leave has ended.
Paternity leave
Male employees are granted three days’ leave on the birth or adoption of a child. They are also entitled to 11 consecutive days of paternity leave (18 days if there are multiple births or adoptions), which must be taken within four months following the birth.
Adoption leave
Employees are entitled to the following leave after the adoption of the child, regardless of their length of service:
The total amount of adoption leave taken cumulatively by the mother and the father must not exceed the limits set out above, unless the relevant CBA provides for additional adoption leave. Employees on maternity, paternity or adoption leave are entitled to a daily allowance from the social security authorities, but the employer is under no obligation to maintain the employee’s salary during this time. However, CBAs frequently provide for the payment of the employee’s salary in full, subject to the latter having completed a certain length of continuous service (usually one year’s service on the date of the birth or adoption of the child).
Parental leave
Employees are entitled to take parental leave or work part-time, from the date of birth until the child’s third birthday.
If the employee takes parental leave, the employment contract is suspended and the employee does not receive any compensation from the company. The employee may however receive certain indemnities from the social security system.
Parents can also benefit from additional leave when their child is sick, which is usually limited to five days per year. However, if the child suffers from a serious illness or disability, the parents can ask to work part-time or suspend their employment contract for a maximum of 12 months.
10. DISCIPLINE AND TERMINATION
10.1 What rules/procedures must be followed if an employer wishes to discipline an employee?
The procedure depends on the sanction contemplated by the employer. In any case, the time frame regarding disciplinary measures against an employee is limited to two months; the time limit does not run when legal action has been taken against an employee on that particular matter.
In the event of a minor sanction, the employer must send a warning letter to the employee, by registered post with acknowledgment of receipt or hand-delivered against a signed release upon receipt, setting out the reasons for the warning.
When other sanctions are contemplated, the employer must hand-deliver or mail a letter of notice in which it sets forth the conduct for which the employee is to be disciplined, the date, hour and place of the meeting to which the employee is invited to defend him or herself, and a reminder of the fact that the employee may be assisted at the meeting by another employee from the company. In the event where the employer is not satisfied with the explanation given by the employee during the meeting, it may impose a sanction either by hand-delivering a letter to the employee or by sending it to same by registered letter. Notice must be given to the employee no less than one complete day and no more than 30 days after the meeting was held.
The employment tribunal has jurisdiction over claims deriving from disciplinary sanctions. It inter alia pays particular attention to the proportionality of the sanction regarding the misconduct.
10.2 What disciplinary action may be taken?
There is no list of applicable sanctions. They are defined by article L. 122-40 of the French Labour Code as ‘any measure – except verbal ones – taken by the employer against any scheme from the employee regarded as an act of misconduct by the employer’.
Still they need to be listed in the company’s internal rules and regulations so as to be applicable. The nature and the scale of the sanctions must be previously determined.
The employer has the power to individualise sanctions, but within a tight limit strictly controlled by case law, so as not to become discrimination.
Furthermore, fines and financial sanctions are prohibited and an employee cannot be sanctioned twice for the same act of misconduct. Nevertheless, previous acts of misconduct
– in a three year time limit – can be taken into account at the present time to enforce more severe sanctions.
Sanctions can be warnings, reprimands, suspensions of the employment contract, disciplinary transfers, demotions, and dismissals based on serious misconduct.
10.3 What are the grounds on which employment contracts can be terminated (by both employer and employee)?
An indefinite-term employment contract may be terminated by both parties at any time, subject to observing a notice period and complying with relevant legal procedures. The employer may terminate an employment contract on personal grounds or on economic grounds. The employee is not obligated to give the grounds for his/her resignation.
An employer can only terminate an indefinite-term employment contract on real and serious grounds and only for the following reasons – otherwise the dismissal will be unfair:
• Personal grounds can include either misconduct or conduct such as:
An employee’s repeated absence or absence over a long period of time (not related to a work-related accident or illness) may constitute, in certain circumstances, valid grounds for dismissal.
See below for economic grounds.
10.4 What procedure must be followed?
Formal requirements as well as a substantial one must be respected in order for the dismissal to be considered fair. The substantial requirement imposes that there be a real and serious cause to the dismissal. The formal requirements set up the procedure to be followed.
First, the employer must summon the employee, whose dismissal it is considering, to a preliminary meeting. Article L.122-4 of the French Labour Code indicates that the summons letter must specify the hour and place of the meeting as well as the fact that the employee may be assisted by an employee from the company or by an outside person.
During the meeting the employer is required to expose the reasons for its intention and to take note of the employee’s explanations. The meeting must take place no earlier than five days after the employee receives the summons.
The notification of the employer’s decision has to be made by registered letter with acknowledgment of receipt at least two days after the meeting, whereby the content of the letter must state the grounds for the dismissal.
The employee can dispute the grounds for his/her dismissal in front of the employment tribunal.
10.5 What indemnities must be paid?
Dismissed employees are entitled to three kinds of indemnities:
10.6 What are the consequences of not having the right grounds/following the right procedure?
If the employer terminates the contract for any reason other that those set forth above, the employee may claim damages before the courts for breach of contract amounting to at least what he/she would have earned had the contract continued to the end of the specified term. An award for damages would then be made in addition to the termination indemnity.
In the event of termination of a fixed-term contract before its specified term by the employee for a reason not mentioned above, the company could claim damages before the courts for breach of contract. The courts award damages based on the loss actually suffered by the company.
10.7 Do special rules apply in certain situations?
Protected categories
Certain employees enjoy varying levels of specific protection against dismissal, including:
Fixed-term contracts
Following completion of the trial period, a fixed-term employment contract may only be terminated in the event of:
Probationary periods
The special rule that applies is that both the employee and the employer can decide to terminate the employment relationship without any notice period, motivation nor indemnity.
11. COLLECTIVE DISMISSALS
11.1 What is the definition of collective dismissal?
According to article L.321-1 of the French Labour Code, a collective redundancy is ‘a dismissal decided by the employer for one or more reasons that are not related to the employee, which result from the elimination or transformation of a position, or a modification, refused by the employee, of an essential element of the employment contract, notably due to economic difficulties or technological changes’.
Where the employer invokes economic difficulties to support the redundancy, they are assessed at company level and not at site level. With regard to group companies, the economic difficulties are assessed based on the group’s line of business, in which the company operates.
In addition, the courts have established a third economic ground, which could also give rise to redundancy proceedings. In essence, the courts have considered that where the redundancy proceedings are necessary to safeguard the competitiveness of the company, the redundancy proceedings are founded on real and serious grounds.
It is assessed either at company level or based on the group’s business sector.
Nevertheless, in light of the court’s sovereign power to assess the facts and evidence submitted, it may rule that ‘in light of the company’s situation, the company’s competitiveness was not threatened’.
Better management or the interests of the company invoked by a financially healthy company, are not considered as valid grounds to demonstrate that the restructuring is necessary to preserve the company’s competitiveness.
In this section we will deal with collective redundancies of at least ten employees over a 30day period in a company employing at least 50 employees and a works council.
11.2 What is the procedure that must be followed in the event of collective dismissals?
Internal redeployment obligations
For the redundancy proceedings to be deemed legitimate and justified, the employer is obliged, prior to making any of its employees redundant, to do its utmost to redeploy the affected employees to another position within the company or the group, irrespective of the number of redundancies and the headcount.
Article L.321-1 of the French Labour Code provides that an employee may only be made redundant if his/her redeployment within the company or group to a position in the same professional category or a lower professional category proves to be impossible.
Therefore, an employer must ensure that it used its best endeavours to redeploy the affected employees (letters sent throughout the group requesting a list of all available positions within the group, written redeployment offers sent to employees, etc). The employer’s redeployment initiatives must be carried out before the affected employees are notified of their redundancy.
The employer must also be able to demonstrate that there were no available positions corresponding to the employee’s profile, which could be put forward in order to avoid his/her redundancy, or that the employee refused the positions put forward.
Defining the order of redundancies
Where an employer is unable to internally redeploy its employees, it is required to define the criteria that shall be applied to govern the order of the contemplated redundancies.
It should be noted that the criteria selected to determine the order of redundancies may only be fixed after the employer has consulted with the works council and/or the staff delegates on this issue. Pursuant to article L.321-1-1 of the French Labour Code, an employer must determine the order of redundancies based on the following legal criteria:
Where an employer wishes to eliminate a position, the criteria selected to determine the employee to be made redundant must be applied within the professional category of the eliminated position. Furthermore, the order of the redundancies must be assessed at overall company level and not merely at site level.
Moreover, it is possible to provide that an employee, who volunteers to leave, is made redundant. However, it is important that the relevant employee comes to a voluntary decision to leave.
Informing and consulting the works council on the contemplated reorganisation (Book IV Process)
Summons of the works council to the first meeting
The employer must summon the works council to a meeting and provide it, at this time, with comprehensive and precise information on:
Chartered accountant
It is customary for the works council to ask for the appointment of a chartered accountant who will cover both Book III and Book IV procedures.
Organisation and timing of the meetings
Article L.432-1 does not set the number of meetings, which must be held as part of the Book IV procedure. However, French case law considers that management should address all the issues raised by the staff representatives and answer all their questions prior to the holding of a vote, even if this results in several meetings being held.
Once management has addressed the issues raised by the staff representatives, a vote should be held in order to allow the staff representatives to express their opinion and comment on the proposed measures. However, the staff representatives’ opinion is not binding on the employer. The works council’s opinion on the contemplated restructuring must be forwarded to the Local State Employment Organisation.
Health, safety, and working conditions committee (CHSCT)
In the event where the restructuring leads to significant changes in the employment positions,
it is also necessary to inform and consult the health, safety and working conditions
committee. It must be informed 15 days before the meeting.
In addition, the health, safety, and working conditions committee may appoint an expert,
financed by the company, to prepare a report regarding the changes in the working
conditions. Based on the expert’s report, the health, safety and working conditions committee
must give its opinion and, where applicable, its recommendations.
Informing and consulting the works council on the contemplated redundancies (Book III Process)
In accordance with article L.321-2 of the French Labour Code, ‘employers who contemplate carrying out collective redundancies are obliged, where the number of redundancies amounts to at least ten over a 30-day period, to call a meeting of and consult the works council pursuant to article L.321-3’ of the Labour Code.
This information and consultation procedure must be completed before a final decision is reached on the contemplated redundancies.
Summons of the works council to the first meeting
Prior to summoning the works council to a meeting, an employer must provide it with all useful information relating to the contemplated redundancies; in practice, the information is already contained in the document provided to the works council at the launch of the Book IV process.
This information, along with the minutes of the meetings held with the works council during the Book III process, is forwarded to the Local State Employment Organisation.
Chartered accountant
The works council is entitled to be assisted by a chartered accountant during the Book III process. The chartered accountant’s mandate consists of assisting the works council with all financial and economic issues. The employer pays the chartered accountant’s fees.
Organisation and timing of the meetings
The works council’s decision to appoint a chartered accountant shall affect the number of meetings that must be held during the course of the redundancy proceedings.
When the works council is not assisted by a chartered accountant, this stage of the redundancy proceedings may be subdivided into a minimum of two meetings, which must be held within a maximum of 14 days. If the works council is assisted by a chartered accountant, this stage of the process shall be subdivided into three meetings.
Book IV and Book III may be launched concomitantly, successively, or partially concomitantly.
Establishing a collective redundancy plan
Pursuant to article L.321-4-1 of the French Labour Code, an employer must establish a collective redundancy plan in case of a contemplated redundancy of ten or more employees in a company of at least 50 employees.
The purpose of a collective redundancy plan is to mitigate the consequences of the redundancies by providing for accompanying employment measures aimed, inter alia, at redeploying or retraining employees facing redundancy (particularly older or disabled employees). The collective redundancy plan must contain:
Pursuant to article L.321-4-1 of the French Labour Code, the validity of the collective redundancy plan must be assessed based on the size and financial situation of the company/group and the redeployment opportunities available within the company or the group.
It is, however, possible to negotiate and enter into derogative agreements with the majority trade union of the company. They are called method agreements (accords de méthode) and can be entered into at company, group or branch level. They deal with the information and consultation procedure of the works council and determine on what conditions the drafting of a collective redundancy plan can be agreed upon. They set a framework within which alternative proposals from the works council can be made or any other action can be taken. Still, their failure to comply with labour laws remains forbidden.
External redeployment measures
Articles L.321-4-2 and L.321-4-3 of the Labour Code include new measures aimed at encouraging the redeployment of employees facing redundancy. In practice, these measures include bonuses for prompt redeployment, relocation bonuses, financing of moving costs, financing of costs incurred in job seeking, redeployment assistance for the employee’s spouse in the event of relocation, allowance covering difference in salary between the former and new employment and so forth. Moreover, certain measures are expressly provided for by law. These measures depend on the company’s or the group’s headcount
Personalised redeployment agreement
Deriving from an Act of 18 January 2005, this new system is enforceable in companies whose workforce is lower than 1,000 employees. This redeployment agreement entitles employees, who so wish, to benefit from measures of psychological support, orientation, coaching, training and assessment of professional skills, destined to favour their redeployment. If need be, these measures may be implemented and funded namely by the use of the rights employees have acquired up until the date of termination of their employment contract pursuant to the right to individual professional training.
In the event where the employee accepts the personalised redeployment leave, his/her employment contract shall be considered terminated by mutual agreement from both parties, without notice or compensation in lieu of notice. This common-consent termination does however entitle the employee to severance pay provided for by law or collective bargaining agreement.
The employer shall participate in the financing of the allowance, ie a contribution amounting to a minimum of two months of the beneficiary employee’s salary.
Redeployment leave
Pursuant to article L.321-4-3 of the Labour Code, each employee facing redundancy must be offered redeployment leave by the employer in:
This measure applies regardless of the number of redundancies.
The employer must inform and consult the works council regarding the implementation of redeployment leave during the meetings organised as part of the Book III procedure.
The employer must state in the redundancy letter that the employee is entitled to take redeployment leave. Redeployment leave is designed to allow the employee to undertake training and benefit from job hunting assistance provided by the French national employment agency (ANPE). As part of the redeployment leave, the employee may also take the necessary steps to have his/her previous professional experience accredited.
A career assessment and guidance meeting is held at the start of the redeployment leave. The aim is to establish a career plan for the employee as well as how to implement it.
The redeployment leave lasts four to nine months. The redeployment leave may be terminated early if the employee finds a job during the redeployment leave or if the employee does not comply with his/her obligation to attend the training sessions.
The employee takes the redeployment leave during his/her notice period, which the employee is released from working. If the redeployment leave lasts longer than the notice period, the notice period must be extended until the end of the redeployment leave.
The employee continues to receive his/her normal salary due during the notice period. The redeployment leave is financed by the employer.
Business development
(This does not apply to redundancies of less than ten employees over a 30-day period)
When collective redundancies are likely to have a negative impact on the local employment market, the company must help develop business in the area.
The prefect of the administrative region may hold a meeting with the employer, the trade union representatives, the employer’s representative organisation, the representatives of the Commercial Court and the staff representatives elected within the company.
An agreement entered into between the company and the prefect of the administrative region stipulates the measures in the collective redundancy plan aimed at developing business and at implementing professional training in the area.
The company’s contribution is based on the number of redundancies and its financial capacity.
Role of the local state employment organisation
(It must be informed eight days after the notification of the redundancy to the employees when less than ten employees are concerned)
Notifying the Local State Employment Organisation
In accordance with article L.321-4 of the French Labour Code, the information provided to the works council at the time of its summons to the meetings must also be forwarded to the Local State Employment Organisation.
The Local State Employment Organisation’s role regarding the collective redundancy plan
The administrative authorities review and ensure that the collective redundancy plan has been drafted in compliance with the law. In the event where it deems that the collective redundancy plan is inadequate, it must notify the employer accordingly.
Although the administrative authorities’ notice of shortcomings of the collective redundancy plan is not legally binding on the employer, it is generally recommended that the employer comply with it in order to avoid the filing of a legal suit by the works council or trade union organisations before the courts.
In addition, the administrative authorities check whether the information process and the redeployment measures have been complied with. In the event of any shortcomings, the administrative authorities inform the employer, who is obliged to reply before notifying the employees of their redundancy.
Redundancy notification
It should be noted that in case of ten or more redundancies in a company of at least 50 employees over a 30-day period, the employer is not required to summon or hold a pre-redundancy meeting for the employees facing redundancy, except in the case of protected employees.
The employer must observe a minimum set period of time before notifying the employees of their redundancy:
These set time frames start to run as of the date of the notification of the Local State Employment Organisation of the contemplated redundancies. However, when a chartered accountant is appointed by the works council, these set time frames start to run 14 days as of the date of notification of the Local State Employment Organisation of the contemplated redundancies.
The redundancy letters must inform the employees facing redundancy that they are entitled to a one-year rehiring priority with effect from the termination of their employment contract.
If an employee notifies the employer that he/she wishes to take advantage of the rehiring priority, the employer must inform same of all available positions matching his/her professional profile. The employer is also obligated to inform the works council of all available positions and post all vacancies on a notice board.
The redundancy letter must also offer the employee the possibility to take advantage of external redeployment measures.
11.3 What are the consequences of not complying with the applicable procedures?
Different types of sanctions have to be mentioned.
Criminal sanctions
Délit d’entrave
Under French law, the breach by the head of the company or a duly empowered representative of their obligations towards staff representative bodies is a criminal offence known as délit d’entrave. Failures to inform and consult fall into this category.
This offence is punishable by a maximum of one year’s imprisonment and/or by a maximum fine of €3,750 (and, for repeated offences, a maximum of two years’ imprisonment and/or a maximum fine of €7,500).
Other offences
Pursuant to article L.321-11 of the Labour Code, the following acts constitute criminal offences:
These offences are liable to a fine of up to €3,750 per employee concerned.
In addition, failure to provide the employees with information regarding the criteria selected for the order of redundancies is a criminal offence liable to a fine of up to €750 per employee concerned.
Civil sanctions
Collective redundancies not substantiated by real and serious grounds
Where the redundancy is not based on real and serious grounds and consequently constitutes unfair dismissal, the court may ask for the employee to be reinstated. If the employee or the employer refuses, the court awards the employee damages for unfair dismissal amounting to at least six months’ salary. Employees with less than two years’ service may also be entitled to damages, but there is no minimum set amount.
On average, between six and 12 months’ salary are awarded as damages.
The damages awarded depend on the employee’s age, length of service and employability.
Where the court notes that the employer did not comply with its internal redeployment obligation, the employees are entitled to claim damages for the loss incurred.
Non-compliance with the collective redundancy procedure
Where an employee is made redundant based on real and serious grounds by a company that fails to comply with the redundancy procedure (information and/or consultation of the works council, notification to the Local State Employment Organisation, notification to the employees of their redundancy), the court may award the employee damages for the loss incurred.
Order of redundancies
Where the employer fails to respect the order of redundancies or provide the employees with information regarding the criteria selected for the order of redundancies, employees may take civil action to obtain damages for the loss incurred.
Invalid collective redundancy plan
Where a collective redundancy plan is deemed insufficient, the redundancy proceedings shall be considered null and void. Therefore, the redundancy of the affected employees shall also be found null and void. Accordingly, the employees in question may either request that they be reinstated or, alternatively, claim damages for a minimum amount of one year’s salary. However, employee reinstatement is not mandatory if it has become impossible, particularly due to the site closure or if there is no position available that would enable the employee to be reinstated.
Non-compliance with rehiring priority obligations
If the employer fails to observe legal provisions relating to the rehiring priority, the courts award the employee damages amounting to at least two months’ salary if the employee has at least two years’ service with the company. Employees with less than two years’ service may also be entitled to damages, but there is no minimum set amount.
Penalties paid to the unemployment authorities:
Delalande contribution
If an employee aged at least 50 is made redundant, the employer must pay a penalty known as the ‘Delalande Contribution’ to the unemployment authorities calculated on the basis of the redundant employee’s gross salary. The reference salary is capped at four times the social security ceiling (ie, €10,356 for 2006).
Reimbursement of unemployment benefits in the event of unfair dismissal
If the court considers that an employee was unfairly made redundant, it orders the employer to reimburse all or part of the unemployment benefits paid to the redundant employee during the period between his/her redundancy and the court decision (up to a limit of six months’ unemployment benefits per employee).
11.4 What are employees’ rights in the event of collective dismissals?
Besides the rehiring priority and the redeployment efforts they can benefit from, employees who are made redundant are entitled to the following payments:
Severance pay provided by the relevant collective bargaining agreement
Employees who are made redundant must receive severance pay in accordance with their length of service and the provisions of the relevant collective bargaining agreement. The calculation of the severance pay is generally based on the employee’s average salary during his/her last 12 months of employment. The employee’s basic salary and bonuses are often included in the calculation of the employee’s average salary.
The employee receives statutory severance pay in the event where the severance pay provided for by the collective bargaining agreement is lower than the statutory severance pay or where no collective bargaining agreement applies within the company.
| For each year of service | 2/10 of the employee’s gross monthly salary |
| per year of service | |
| For each year of service over | An additional 2/15 of the employee’s |
| 10 years | gross monthly salary per year of service |
Indemnity in lieu of notice period
If the employer wishes to release the employee from the obligation to work during the notice period, this must be expressly stated in the redundancy letter and the employer will still be required to pay the employee the salary he/she would have received during the period concerned.
Indemnity in lieu of paid holiday
The employee is entitled to receive an indemnity in lieu of paid holiday that he/she has accrued but not taken on the date of the termination of the employment contract.
The refusal from an employee to modify an essential element of his/her work contract (remuneration, working hours, and workplace) following economic difficulties, technological changes or a reorganisation in order to safeguard the competitiveness of the company can lead to a redundancy. The rights guaranteed depend on the number of employees dismissed: give or take ten in a 30-day period.
12. FORTHCOMING LEGISLATION
A bill on social dialogue and trade union representation is under consideration.
13. USEFUL REFERENCES
